The Escritura is Spanish for Title Deeds and is a very important document in the Spanish property conveyancing process. It is a legal document that contains the following:
- Former owners personal details
- Buyers personal details
- The legal representatives who are involved details
- Land registry details
- Translators details
- Property’s address
- Property description, which is usually obtained in the form of nota simple
- The property price
- Cadastral price
- Property taxes
- Mortgage details
- A breakdown of how the price is being paid
- Miscellanea, including;
Certificate of the Community of Owners. This states that the property is debt free and up to date with all its communal payments.
Council tax bills
Copy of the license of first occupation
Once the title deed is signed it is submitted to the land registry so the ownership details can be changed. In Spain, Title Deeds are signed by the Notary and the buyer / seller (or Power of Attorney if applicable). The Notary then keeps the document on file.
Non-resident 3% tax retention:
If you are a non-resident vendor of a Spanish property, you must pay the local tax authority 3% of the property price when you are selling. The purpose of retaining this amount is to pay for any outstanding taxes or other fees which the vendor might be liable to pay.
The Notary is responsible for ensuring that the purchase price of the property is split so the 3% retention fee goes to the applicable tax authority.
If the vendor can prove that all of his taxes are paid up to date, then they will be returned the 3%. If the final amount to be paid is lower than the 3% that has been retained, the remainder will be returned to the vendor.
This refund is not returned automatically, the vendor must request for it to be refunded by filing out the relevant tax forms. These forms then need to be sent to the local Spanish tax authority.
Our team can help you reclaim your 3% retention fee.
Non-resident tax returns:
All property owners in Spain are obliged to file an annual non-resident tax return, regardless of whether the owner lives in another country and pays taxes there.
The owner must file this tax return regardless of whether or not they make any income from their property. the tax for these properties is based upon a percentage of the assessed value of the property.
Take the first step today in filing your non-resident tax returns by contacting HomeFinance today.
Should I get a survey completed on my Spanish property before buying?
HomeFinance strongly recommends buyers get an independent survey completed on the property they are planning to buy. If you are obtaining a mortgage for the property, the bank will have a valuation completed. However, any defects of the property which do not affect the value of the property will not appear on the report.
This is why it is important for buyers to be fully aware of what they are buying.
The survey will highlight any issues that could affect the property in the future and rates the condition of its structure. You can also request a survey that gives advice on the future maintenance of the property.
A survey can prove very useful for buyers as it highlights any damage that might be prove useful when negotiating the purchase price or request for the vendors to have certain works carried out before the property is purchased.
HomeFinance can arrange for an independent architect to complete a survey on the property, so you have peace of mind on what you are purchasing.